Govt Cuts Gold Jewellery Duty Drawback By 3.1%; Silver Rates By Nearly 9%

The Central Government on Friday reduced duty drawback rates for gold and silver jewellery exports, lowering refunds for precious metal products and potentially affecting exporters’ profit margins.

According to a Finance Ministry notification, the duty drawback rate for gold jewellery has fallen from Rs 1,851.99 to Rs 1,794.11 per gram, a reduction of around 3.1%.

The cut for silver jewellery and other silver products is steeper. The refund rate has dropped from Rs 29,501.09 to Rs 26,859.02 per kilogram, marking a decline of nearly 9%.

Duty drawback allows exporters to recover eligible customs duties and other levies paid on inputs used to manufacture goods for export.

The mechanism aims to reduce production costs and improve the competitiveness of Indian products in international markets.

The latest revision reverses part of the relief extended to jewellery exporters in July this year. At that time, the government raised the gold jewellery refund rate from Rs 773.17 to Rs 1,851.99 per gram.

Similarly, it increased the duty drawback rate for silver products from Rs 14,990.66 to Rs 29,501.09 per kilogram.

The latest reductions will lower the refunds exporters receive on eligible shipments compared with the previous rates. The extent of the impact will depend on export volumes, production costs and international demand.

However, industry experts believe strong global demand could cushion the effect of the reduced refunds on jewellery exports.

The revised rates come as exporters navigate changing production costs and global market conditions, with the jewellery sector remaining sensitive to fluctuations in precious metal prices and overseas demand.

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